Costco Must Pay Tiffany & Co. $5.5 Million in Ring Case

The jury also ruled that Tiffany is entitled to punitive damages

A New York jury has ordered Costco to pay Tiffany & Co. $5.5 million for selling rings marked Tiffany—and other damages may follow.

Tiffany first sued Costco in 2013, after discovering that Costco was selling rings in a Huntington Beach, Calif., store marked Tiffany. Costco asserted that it was simply noting the rings had Tiffany settings, and the case took a significant detour as the parties debated whether Tiffany setting could be considered a generic term.

Last September, Judge Laura Taylor Swain handed Tiffany an across-the-board victory, finding that Tiffany setting was not generic and ruled on summary judgment that Costco was guilty of both counterfeiting and trademark infringement in selling the rings. She ordered a jury to determine a reward for Tiffany, which it did last week.

The jury also ruled that Tiffany was entitled to punitive damages, though it did not include a figure.

In her jury instructions, Swain said the damages need to spring from “Costco’s sale of rings with signage that included the word Tiffany as a stand-alone term not combined with an immediately following modifying word such as setting, set, or style.”

Tiffany did not respond to requests for comment. A Costco statement said, “Because the jury’s deliberations are continuing, further comment is not appropriate at this time.”